Mandatory fee on the sale of assets by foreigners is introduced

On 27 March the Government Commission for Control over Foreign Investments in the Russian Federation (the “Subcommittee”) published the Minutes of its meeting dated 2 March 2023 No. 143/4.

We remind you that 22 December 2022, the Subcommittee introduced conditions for the issuance by the Subcommission of a permit for transactions for the alienation of securities by foreigners from unfriendly countries. Among them is the obligation to “voluntarily” transfer funds to the budget in the amount of at least 10% of the transaction amount.

On 27 March the amounts of money that are required to be paid to the federal budget when making transactions with "unfriendly" non-residents were changed:

• At least 5% of the market value indicated in the valuation report;

Or

• Not less than 10% of the market value indicated in the valuation report, if shares are sold at a discount of more than 90% of the market value.

The rest of the conditions stipulated by the Protocol of 22 December 2022, including the condition on the size of the discount (50%), the establishment of KPIs, remained as before.

Source: Minutes of the meeting of the Government Commission for Control over Foreign Investments in the Russian Federation dated 2 March 2023 No. 143/4 https://minfin.gov.ru/ru/document?id_4=301169-vypiska_iz_protokola_zasedaniya_podkomissii_pravitelst....

See previous articles on the topic:

Our review - https://nplaw.ru/blog/detail/minfin-vvel-usloviya-pri-sovershenii-sdelok-inostrantsami-iz-nedruzhest....

Minutes of the meeting of the Government Commission for the Control of Foreign Investments in the Russian Federation dated 22 December 2022 No. 118/1 (https://minfin.gov.ru/ru/document?id_4=301169-vypiska_iz_protokola_zasedaniya_podkomissii_pravitelst...)

Nadmitov, Ivanov and Partners Law Firm advises on obtaining permission from the Government Commission for the Control of Foreign Investments in the Russian Federation for transactions and operations with securities, sanctions, counter-sanctions and corporate law.